Bombay High Court Quashes Criminal Proceedings in Cheque Dishonour Cases Due to Lack of Proper Service of Notice. Failure to Prove Service of Demand Notice Under Section 138 of Negotiable Instruments Act, 1881 Results in Quashing of Complaints.

High Court: Bombay High Court Bench: NAGPUR In Favour of Accused
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Case Note & Summary

The judgment pertains to multiple criminal applications filed under Section 482 of the Criminal Procedure Code, 1973, seeking quashing of complaints under Section 138 of the Negotiable Instruments Act, 1881. The applicants, who are businessmen from Wani, District Yavatmal, were accused of dishonour of cheques. The core issue was whether the demand notice under Section 138 was properly served upon the accused. The court examined the complaints and found that the notices were sent by registered post but there was no evidence of actual service or refusal by the accused. The court noted that the mere sending of notice by registered post does not raise a presumption of service unless it is proved that the notice was tendered to the addressee. Since the complaints did not contain any averment regarding service of notice, the essential ingredient of the offence was missing. The court, therefore, quashed the proceedings in all the applications, holding that the continuation of such proceedings would be an abuse of the process of law.

Headnote

A) Criminal Law - Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Service of Notice - The court considered whether the complaints under Section 138 of the Negotiable Instruments Act, 1881 were maintainable when the demand notice was not properly served on the accused. The court held that the prosecution must prove service of notice, and in the absence of such proof, the proceedings are liable to be quashed. (Paras 1-10)

B) Criminal Procedure Code - Quashing of Proceedings - Section 482 - Inherent Powers - The court exercised its inherent powers under Section 482 of the Criminal Procedure Code, 1973 to quash the criminal proceedings against the applicants, as the complaints did not disclose the necessary ingredients of the offence under Section 138 of the Negotiable Instruments Act, 1881. (Paras 1-10)

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Issue of Consideration

Whether criminal proceedings under Section 138 of the Negotiable Instruments Act, 1881 can be sustained when there is no proper service of demand notice upon the accused.

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Final Decision

The court allowed all the applications and quashed the criminal proceedings against the applicants.

Law Points

  • Quashing of criminal proceedings
  • Section 138 Negotiable Instruments Act
  • 1881
  • Service of notice
  • Presumption of service
  • Criminal Procedure Code
  • 1973 Section 482
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Case Details

2015 LawText (BOM) (03) 153

Criminal Application (apl) No. 664 of 2014 with APL Nos. 474/14, 513/14, 514/14, 518/14, 519/14, 520/14, 521/14, 522/14, 523/14, 524/14, 525/14, 526/14, 527/14, 528/14, 532/14, 533/14, 534/14, 535/14, 536/14, 537/14, 538/14 and 542/14

2015-04-01

Mr. M.V. & C.M. Samarth, Mr. M.M. Ekre, Mr. S.M. Bhagade

Vasudeo s/o Bhavalal Malu, Suresh Murlidharji Bajoriya, Surendra Darbarilal Jain, Hariram s/o Sajjankumar Mittal, Omprakash s/o Maniram Agrawal, Naresh s/o Dhanraj Jain

The Sub Divisional Officer/Sub Divisional Magistrate, Wani, District Yavatmal

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Nature of Litigation

Criminal applications under Section 482 of CrPC for quashing of complaints under Section 138 of Negotiable Instruments Act.

Remedy Sought

Quashing of criminal proceedings for dishonour of cheques.

Filing Reason

The applicants alleged that the demand notice under Section 138 was not properly served on them.

Issues

Whether the complaints under Section 138 of the Negotiable Instruments Act, 1881 are maintainable when the demand notice is not properly served on the accused.

Submissions/Arguments

The applicants argued that the demand notice was not served on them and the complaints did not disclose the necessary ingredients of the offence. The non-applicant (State) opposed the applications.

Ratio Decidendi

For an offence under Section 138 of the Negotiable Instruments Act, 1881, the prosecution must prove that the demand notice was served on the accused. Mere sending of notice by registered post does not raise a presumption of service unless it is proved that the notice was tendered to the addressee. In the absence of such proof, the proceedings are liable to be quashed.

Judgment Excerpts

The court held that the complaints do not disclose the necessary ingredients of the offence under Section 138 of the Negotiable Instruments Act, 1881. The court quashed the proceedings as the continuation would be an abuse of the process of law.

Procedural History

The applicants filed multiple criminal applications under Section 482 of CrPC before the Bombay High Court, Nagpur Bench, seeking quashing of complaints under Section 138 of the Negotiable Instruments Act, 1881. The court heard all applications together and disposed them by a common order.

Acts & Sections

  • Negotiable Instruments Act, 1881: 138
  • Code of Criminal Procedure, 1973: 482
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High Court Bombay High Court Quashes Criminal Proceedings in Cheque Dishonour Cases Due to Lack of Proper Service of Notice. Failure to Prove Service of Demand Notice Under Section 138 of Negotiable Instruments Act, 1881 Results in Quashing of Complaints.
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